Wednesday 24 May 2017

Unlawful searches took place in FitzPatrick investigation

Former AIB chairman Sean FitzPatrick Photo: Steve Humphreys
Former AIB chairman Sean FitzPatrick Photo: Steve Humphreys
Shane Phelan

Shane Phelan

A number of searches conducted by gardaí investigating issues at Anglo Irish Bank were unlawful.

The disclosure was made on the first day of evidence at the trial of former Anglo Irish Bank chairman Sean FitzPatrick on charges of misleading auditors about loans he had from the bank.

But despite the unlawful nature of the searches, a jury was told Dublin Circuit Criminal Court had ruled they could still be shown documents seized.

The court heard about two warrants for searches at the headquarters of Irish Nationwide Building Society and five warrants for searches at Anglo’s headquarters and another Anglo building in Dublin.

These led to large quantities of documents and electronic material being seized in 2009 and 2010.

The court heard evidence from three garda officers who were involved in the searches.

One of them, Detective Sergeant Brian Mahon testified that warrants were secured from the District Court under Section 20 of the Companies Act in order to gain access to Irish Nationwide and Anglo premises.

But under cross examination from defence counsel Bernard Condon SC, he agreed that those searches had been deemed by the court to be unlawful and that he had been informed of this.

“All of the entries were ruled by the court to be unlawful and unconstitutional, but it will have no consequence in terms of the jury receiving the documents,” said Mr Condon.

Details of further searches, also deemed unlawful, were given by retired Detective Superintendent Eamonn Keogh and Detective Sergeant Michael Prendergast.

Det Supt Keogh, who was on secondment to the Office of the Director of Corporate Enforcement during the investigation, gave evidence of conducting searches at Anglo’s headquarters on St Stephen’s Green and an adjoining building between February 24 and March 6, 2009.

He said he was given a folder of documents by an Anglo staff member, while hard drives were also seized.

Another garda, Sergeant Karl Moriarty, testified about serving production orders on Irish Nationwide and Anglo in 2011 while on secondment at the Office of the Director of Corporate Enforcement.

These required the two institutions to produce certain documents and material in relation to bank accounts.

The information sought included the beneficiaries of certain accounts, bank statements, and details of cheques and payments drawn from those accounts.

The witness said the production orders led to many thousands of documents being produced.

Following his evidence, prosecution counsel Dominic McGinn said there was a legal issue which needed to be dealt with.

Judge John Aylmer excused the jury and asked it to return tomorrow morning.

Although a jury was sworn in the case last September, today was the first day it heard direct evidence.

Jurors were previously informed that evidence had been delayed due to a number of legal matters needed to be decided upon in their absence.

The prosecution claims Mr FitzPatrick (68) failed to disclose multi-million euro directors’ loans used for property investments between 2002 and 2007.

During that period he borrowed sums ranging from between €10m and in the region of €100m from Anglo.

The prosecution alleged Mr FitzPatrick failed to disclose these loans as he was obliged to do under the Companies Act.

Mr FitzPatrick, of Whitshed Road, Greystones, Co Wicklow, has pleaded not guilty to 27 charges he is facing.

The 27 charges include 21 counts of making misleading, false or deceptive statements to the auditors of Anglo Irish Bank, contrary to section 197 of the Companies Act 1990.

The offences allegedly occurred on dates between 2002 and 2007 and carry a maximum five year jail term.

Five counts allege Mr FitzPatrick did not disclose to auditors Ernst & Young arrangements temporarily reducing the balance of loans to him or persons connected to him at the end of the financial year.

The reductions cited ranged in size from €4.3m to €88.9m.

Six counts allege Mr FitzPatrick failed to advise auditors of the need to revise financial statements after each temporary arrangement concluded.

The sums involved in the arrangements cited ranged from €700,000 and €119.8m.

Four counts allege Mr FitzPatrick failed to disclose the full extent of loans received by him or persons connected to him from Anglo, ranging in value between €5.5m and €23.8m.

Six counts allege Mr FitzPatrick failed to inform auditors of an arrangement between Anglo and Irish Nationwide regarding loans he received from Irish Nationwide.

He also faces six charges of giving false information contrary to section 242 of the Companies Act 1990 on dates between 2002 and 2008.

The offences carry a maximum jail term of three years.

All of these counts relate to Mr FitzPatrick allegedly producing financial statements giving a false figure for the aggregate value of loans to directors of Anglo.

It is alleged the amounts given included the total amount borrowed by all Anglo directors apart from Mr FitzPatrick.

As a result they would have given a figure for directors’ loans that was “false and misleading.

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